Los Angeles daily herald., 1887-08-03
SENATOR STANFORD
Says that the Central Pa
citic Company
WILL TRANSFER THE ROAI
To the Government on Receipt of
its Dues-The Book Dis
pute Settled.

Associated Press Dispatches to the HERALD.
SAN Francisco, August 2.-The ex-
animation of Senator Stanford was
resumed before the Pacific Railroad
Commission to-day. He insisted that
the Central Pacific Company in re-
ceiving financial aid from the govern
ment occupied the position OF an
independent contracting party and
was not acting as agent in fiduciary
capacity as he (Stanford) inferred, the
Commissioners believed from the re-
marks made by them. He gave Il
list of the resources OF the Central and
Western Pacific Companies with the
exception of those originally con-
tributed by the promoters of the en-
terprise up to December 81, 1869.
These resources Stanford stated
amounted to $4,000, 900, and
cf this amount only S4l, ABS ,00o
was realized from the first mortgage
bonds and the Government bonds.
The cost of building the road to Ogden
was $47, 1889, 900 or $55 900 per mile.
Witness said that Engineer Judah
estimated that the road would cost
SOC, 900 per mile and other engineers
thought it could not be built for less
than 800, 900 per mile. He thought
no Board of Engineers would put
lower estimate on the cost or estimate
less than $55, 600 per mile. Stanford
argued that if the Government aid
and the first mortgage bonds had
alone been sufficient to build
the road it would have
cost about $4S, 200 per mile
and that if the Central Pacific Com
pany was compelled to account for its
expenditures to the government, this
would show that the aid granted was
insufficient to build the road, and
upon that basis the government should
make good the deficiency. He stated
that the aid received from the coun-
ties of Yolo, Yuba, Solano, san Mateo,
Los Angeles, San Joaquin and others,
amounting to So ,265 ,060, did not con-
Germ the Central Pacific. In some
cases the money authorized under
Acts Of the Legislature to be given by
the counties referred to was never
raised, and where it was it went to
roads other than the Central Pacific.
Perhaps some of the roads 30 built were
now leased by the Central, however.
Commissioner Anderson said to witt.
ness "Senator, the belief is prevalent
whether just or not is immaterial-
that the inability of the Central Paci-
fic to pay its indebtedness to the gov
ernment arises from the fact that its
resources have been absorbed through
the contracts let and the work has been
done by the Contract and Finance,
the Western Development and the
Pacific Improvement Companies"
To this Stanford replied that the
money belonging to the Central Pa
cific company had not been diverted
to any other corporation.
Anderson asked if the books of the
corporations which had had dealings
with the Central Pacific we're open for
inspection.
Stanford replied: 81 am ready to
use my influence to have the commits
sion examine any books we have as to
the Central Pacific railroad, but we
have very active rivals and competi-
tors and we have relations with many
individuals. These accounts we do not
wish to be laid before the public, but
so far as the commission is concerned,
we have no objection to its seeing any
thing that it pleases.
Anderson-Do l understand that
this offer includes the inspection OF
the books of the Western Develop
ment, Pacific Improvement and the
other companies which had dealings
with the Central Pacific?
Stanford-So far as those books re-
late to the affairs of the Central Pa
cific we have no objection to their be-
ing opened to your inspection.
Chairman Pattison remarked that
if private inquiry at the Office OF the
railroad company was contemplated
he should put in an objection at once,
for he would not consent, as an officer
of the government, to any star cham
Der proceedings. If the books could
not be publicly inspected he would
not inspect them at all.
Senator Stanford said that the COM
pany did not ask for star chamber
inquiry, it merely desired that such
matters as were not pertinent to the
objects OF the commission be not given
to the public nor made a point OF
record.
Anderson asked that the proposition
of the Central Pacific lawyers in re-
gard to the inspection of the books be
put in writing and this was afterwards
done.
APPEAL FOR THE BOOKS.
During the progress of the foregoing
proceedings a petition had been pre-
sented to the United States circuit court
by the commission, asking that F. S.
Douty, secretary and treasurer of the
Western Development Company and
other similar corporations be COM
PEELED to produce the books OF those
companies for the inspection of the
commission, and Judge Sawyer set the
matter for hearing tomorrow morn
ing.
M A PROPOSITION.
At the afternoon session the follow
ing proposition was presented by the
counsel OF the Central Pacific: "We
will submit to the commission the
books of the company asked for from
Douty, as well as any other evidence
at our command, reserving the right
to assert our legal right to withhold
the same or any portion of the same
whenever, in our judgment, the COM
mission seeks to examine any matters
appearing therein not pertinent to a
proper or full and complete examina-
ton by the commission of all matters
with the investigation of which they
are properly charged, under act of
| Congress.
ACCEPTED.
The Commission decided to accept
the proposition, with the understand
ing that the papers entered in the